Although we may not look it – we are actually a bit odd and unusual…..
We are owners of villas ourselves, and so we have managed and marketed our own villas for over 15 years now. Over that time though we were asked by friends, neighbours and colleagues if we could also look after their villas as well and that is how we have grown into what we are today.
Rather than asking you what price you would like to get for your villa, we carry out an extensive exercise to identify your competitor peer group and then we set out a pricing and marketing strategy to compete with, and beat those competitors.
We then monitor performance and rates against those competitors continuously over time, and we can, and do, change pricing or strategy when competition or market conditions change. This flexibility has been particularly important in the past few years following the Mount Agung eruption, the Lombok earthquake and the changes caused by the impact of the COVID pandemic.
Because we work exclusively with owners, we are able to use our online system to change rates almost instantly on ALL the websites and “channels” that we use to promote and advertise your villa.
Villa rates for most agents are however by definition inflexible. A normal agent’s marketing model involves passing out your villa’s details to dozens of other agents. This does not readily make it easy or quick to rapidly update rates , nor does it make it easy to take on new and different marketing options in response to market conditions.
Many if not almost all agents never visit your villa, or if they do, they do so once when they first take on your villa. We on the other hand visit your villa regularly and in person every 2 to 3 months, and more often initially. We also arrange overnight stays so we can work with your staff to help train them to meet expectations when it comes to guest service.
This is again because of the way that almost all agents except ourselves work. If you list your villa with a normal agent, they then pass your villa details to many other agents, and those other agents will almost certainly never actually see your villa.
While that may seem like a good idea, in practice (as we as owners ourselves found out) it is a terrible way to market your villa. Not only does it mean endless questions from an agent that does not know your villa, but it also often means poor checking of guests and mis-representation of your villa, as an agent’s incentive is often to agree to what a guest wants in order to get their commission.
As an owner we had many bad experiences. A typical one was one agent that told guests that they could smoke at one of our villas. When we told the guests on arrival they could not, the guests were upset, as they had specifically booked the villa to be able to smoke in the bedrooms. We ended up with a bad review online for having “misled” the guests. The agent of course having earned his commission was never seen again.
With us this would never happen. We don’t market dozens or even hundreds of villas like almost all agents do, most of which they have never even seen. We only market a small group of villas that we know and visit regularly, and we also talk to you regularly about your own villa, so we know what you specifically want as well.
We did an experiment recently for one owner.
We sent an email to their current agent, asking to rent a villa with the same characteristics as the owners villa (e.g. location, number of bedrooms, budget etc.) and for dates when we knew the owners villa is available. Not only did it take the agent 3 whole days to get back to us, but when he finally did, he recommended 3 other villas, and not the owner’s villa, despite this villa being available, and meeting all the criteria requested.
This does not happen with us. We only look after around a dozen villas, which normally means only one or two villas in any one area, and often with different key characteristics (such as number of bedrooms).
We only market our owners villas. We don’t do deals with other agents to market their villas. We are not interested in other villas. We are only interested in getting bookings for our owner’s villas, villas that we know well, and can answer any question a guest throws at us. We also know that that detailed knowledge and focus means that we get bookings when other agents would fail.
On the face of it our commissions might look similar to other agents.
20% to 25% is typical for short term bookings (although as much as 30% is often seen too, and some local Indonesian agents may live with 10%).
10% for annual bookings is the norm.
15% for month long bookings is unusual, but to us at least makes sense, particularly during COVID times.
However what most agents do not tell you is that actually the commission deducted from the price paid by the guest is often considerably more than this, and 40% is not unusual at all.
What? Why? I hear you say. Well remember that other agents pass your villa details to other agents? Well that means that both agents have to be paid. Some agree deals to split commission, but we found that more often both agents charged their commission, which was typically 20% each.
More than that most agents if they list on Online Travel Agents (such as AirBnB, Booking.com etc.) have that fee deducted from the guest price as well (typically 15% to 18%).
We don’t work with other agents (except for some very limited and specific reasons) and so dual commission is not an issue. For OTAs we always increase our rates so that our net after OTA fees is the same as the rate that we publish and tell our owners.
Basically we are small professional company with a very personal touch. Tom and Rene still work every day, and most owners will likely end up dealing with them.
We do though also have a great team of staff at our office in Kerobokan, who have been with us through the thick and thin of the past few years, and who handle a lot of the stuff that has to go on behind the scenes to make this all work as well as it does.